Circle is latest crypto company sued over digital-trading patent

(Reuters) – Cryptocurrency provider Circle Internet Financial Ltd was sued in Texas federal court on Thursday by another crypto company that claims Circle violated its digital-asset trading patent.

The lawsuit from Veritaseum Capital LLC seeks at least $350 million in damages based on allegations that several features of Circle’s business infringe its patent.

Veritaseum sued Coinbase for infringing the same patent in September. Coinbase’s motion aims to dismiss the lawsuit that is still pending.

Circle declined to comment on the latest lawsuit. Veritaseum attorney Carl Brundidge of Brundidge & Stanger said in an email Friday that the company “was open to settling this matter without litigation, but Circle was less than cooperative.”

Veritaseum formerly issued the token VERI. In 2019, its founder Reggie Middleton and two Veritaseum entities paid the U.S. Securities and Exchange Commission more than $9.4 million to settle charges of a “fraudulent scheme” to sell the token.

The SEC had accused them of misleading investors about demand for the tokens and manipulating their price. They settled the case without admitting to or denying the charges.

Boston-based Circle operates the stablecoin USDC, which is designed to keep a consistent value. Veritaseum’s lawsuit said Circle’s transfer technology, blockchain infrastructure and other features infringe Middleton’s patent.

The case is Veritaseum Capital LLC v. Circle Internet Financial Ltd, U.S. District Court for the Eastern District of Texas, No. 2:22-cv-00498.

For Veritaseum: Carl Brundidge and David Moore of Brundidge & Stanger

For Circle: not available

(NOTE: This story has been updated with comment from Veritaseum.)

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